Increase of qualifying period for unfair dismissal and introduction of Tribunal fees to “increase competitiveness”
On 3 October 2011 it was announced that the length of the unfair dismissal qualifying period would increase to 2 years and that fees would be introduced for bringing Employment Tribunal claims.
Unfair dismissal qualifying period
In order to bring a claim for unfair dismissal the employee is currently required to have been in employment with his employer for 1 year. From 6 April 2012, the length of the unfair dismissal qualifying period will increase from 1 year to 2 years. This means that an employee will require to have been employed by the same employer for 2 years before he is entitled to bring a claim against his employer for unfair dismissal.
The rationale for this change is to reduce employment related costs for employers with the result that there will be an increase in the number of people in employment.
It is not yet clear whether any transitional measures will be put in place to protect those employees who will have at least 1 year of qualifying service when the new measures come into force. Therefore we do not know if those employees who will have more than 1 but less than 2 years of qualifying service on 6 April 2012 will lose their right to bring a claim for unfair dismissal, at least until they achieve 2 years of qualifying service.
Employment Tribunal Fees
It has been announced that fees will be introduced for bringing a claim in an employment tribunal. Although details of these fees have not been officially announced it has been reported in the media that there will be a consultation on fees, which will commence prior to the beginning of December, with fees being imposed from April 2013. It has also been reported in the media that the proposed fees will include an issue fee of £250 and a listing fee of £1,000, with increased fees where the value of the claim exceeds £30,000.
Employment Law Review
For the past 18 months the UK government has been conducting an ‘Employment Law Review’. The government claims that this is designed to ensure that current employment law produces a competitive environment which will enable businesses to survive while balancing the needs of employers and employees.
From 3 October to 19 October 2011 the government is conducting a ‘Red Tape Challenge’. This is designed to improve or simplify over 160 employment related regulations. Specific areas targeted by the red tape challenge include the rules on collective redundancies, immigration checks and statutory sick pay.
While employers will welcome both the increase in the qualifying period to 2 years and the imposition of tribunal fees, there is uncertainty at present as to what will happen to employees with between 1 and 2 years of qualifying service on 5 April 2012.
Once further details have been provided we will publish an update.
Unfair dismissal rule changes could save british Business £6million
For further information or to discuss the issues raised, please contact David Widdowson or Stephen Wright on +44 20 3051 5711.